The Bangladesh Taka (BDT) continues to weaken against the US dollar as the central bank's ongoing interventions in the foreign exchange market aimed at stabilising the exchange rate.
As part of its efforts, the Bangladesh Bank (BB) purchased $10 million from a leading commercial bank through an auction held on Wednesday. The cut-off rate for the latest transaction was Tk 121.95 per dollar, up from Tk 121.50 set during the previous intervention, according to central bank officials.
Over the past week and a half, the central bank has bought a total of $494 million through three separate auctions. These purchases are intended to bolster the country's foreign exchange reserves, which have come under pressure amid rising import payments and global economic headwinds.
The BB launched this intervention drive on July 13 in a bid to curb volatility in the dollar-taka exchange rate and ensure greater stability in the forex market.
"We're intervening in the market whenever necessary to keep the exchange rate at a tolerable level," a senior BB official told The Financial Express.
He added that the central bank may also sell US dollars to banks via similar mechanisms if the dollar continues to appreciate against the local currency.
Despite these measures, the taka depreciated by 23 paisa against the greenback on Wednesday. The reference rate set by the BB rose to Tk 121.94 per dollar at 5:00pm, up from Tk 121.71 on the previous working day, according to the latest official data.
Since the intervention began on July 13, the local currency has lost Tk 1.27 against the US dollar. On the first day of intervention, the reference rate stood at Tk 120.67 per dollar.
The Bangladesh Foreign Exchange Market Spot Reference Rate is calculated as a transaction-weighted average of spot forex trades of $100,000 or more conducted by all 61 authorised dealer (AD) banks in the country.
These transactions include export proceeds encashment, commercial remittances, deals with exchange houses or aggregators for inward remittances, and spot foreign currency sales covering payments such as letters of credit (LCs), service fees, debt servicing, outbound remittances, and interbank forex trades.
The central bank compiles this data daily to determine the reference rate, which serves as a benchmark for foreign exchange dealings in the formal banking sector.
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